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MAY  2011

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Studies Show Potentially Billions of Barrels of Recoverable Oil Within U.S. Borders

THE GRAPEVINE
A Reader Comment Blog


Gas prices have risen sharply over the past several weeks. Toward the end of April the national average for all grades of gasoline stood at $3.89 and according to reports, this number will only continue to grow. In Cleveland, gas prices have been climbing by a few cents each week. In March, we saw prices around $3.40. Now, these prices have reached $3.71 (as of 04/27/11) and higher. With all of the conflict in the Middle East, it is raising oil barrel prices significantly. So, what is your government doing to ease the money pain associated with gas prices? Nothing. At least, according to reports they aren't.

In a study compiled by the RAND Corporation about oil shale, the document shows the United States has enough oil within its borders to potentially become self sustaining. But the company says that oil shale has not been in the U.S. energy policy agenda since the 1980s and that not much has been done by the government to support technological advances and developments that could change oil shale into a viable oil supply.

In the PDF document, which can be read by following this link
, the company gives pros and cons for many different scenarios, but the hardest pressed issue, is that there are several millions, possibly billions, of barrels of oil in the United States that could be recovered for self-sufficiency.

"The term oil shale generally refers to any sedimentary rock that contains solid bituminous materials that are released as petroleum-like liquids when the rock is heated. To obtain oil from oil shale, the shale must be heated and the liquid must be captured. This process is called retorting, and the vessel in which retorting takes place is known as a retort.

"The largest known oil shale deposits in the world are in the Green River Formation, which covers portions of Colorado, Utah, and Wyoming. Estimates of the oil resource in place within the Green River Formation range from 1.5 to 1.8 trillion barrels. Not all resources in place are recoverable. For potentially recoverable oil shale resources, we could derive upwards of 1.1 trillion barrels of oil or a lower estimate of about 500 billion barrels. For policy planning purposes, it is enough to know that any amount in this range is very high. For example, the midpoint in our estimate range, 800 billion barrels, is more than triple the proven oil reserves of Saudi Arabia. Present U.S. demand for petroleum products is about 20 million barrels per day. If oil shale could be used to meet a quarter of that demand, 800 billion barrels of recoverable resources would last for more than 400 years."

Unfortunately, the study also found that "at least an additional six to eight years will be required to permit, design, construct, shake down, and confirm performance of that initial commercial operation. Consequently, at least 12 and possibly more years will elapse before oil shale development will reach the production growth phase. Under high growth assumptions, an oil shale production level of 1 million barrels per day is probably more than 20 years in the future, and 3 million barrels per day is probably more than 30 years into the future."

But, "if low-cost shale oil production methods can be achieved, direct economic profits in the $20 billion per year range are possible for an oil shale industry producing 3 million barrels per day. Through lease bonus payments, royalties on production, and corporate income taxes, roughly half of these profits will likely go to federal, state, and local governments and, thereby, broadly benefit the public."

If this could be achieved and oil shale could produce 3 million barrels of oil a day within the United States, then it would be highly possibly that oil prices would fall by 3 to 5 percent, given no interference by Organizations of the Petroleum Exporting Countries (OPEC) and other oil suppliers.

Environmentalists are actively against any type of oil recovery within the United States due the damage it would cause to the land, air and wildlife. This report includes the downside to oil shale recovery, such as disturbance of land, air quality could be impacted from emissions, greenhouse gas emissions and water quality. While these can be somewhat contained and controlled, the cost of the production would then go up significantly. But, even so, if this idea is brought to fruition, crude oil could potentially create competition at $30 or less per barrel.

Yahoo! News posted an Associated Press story
by Chi-Chi- Zhang which makes known another potential oil site in Utah in the Uinta Basin. The soil there is completely "saturated with a sticky tar that may soon provide a new domestic source of petroleum for the United States. It would be a first-of-its kind project in the country that some fear could be a slippery slope toward widespread environmental destruction."

However, Living Rivers, an environmental based group, is challenging the project and will be participating in a hearing this month. So, once again, environmentalists are clinging to every square inch of land they can. America needs to reduce its reliance on foreign oil supplies, but too much red tape keeps us from sustaining our needs independently.

"The Bureau of Land Management says Utah has an estimated 12 to 19 million barrels of oil buried in its tar sands, mostly in the eastern part of the state, though not all of that would be accessible.....


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Do you believe the the Federal Government should ignore environmental groups and actively pursue self-sufficiency using known U.S. oil reserves?
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Totals for this survey will be tabulated at the end of May 2011.
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The People News
PO Box 3921
Cleveland TN. 37320
(423) 559-2150  Fax 559-1044

Pete Edwards, Editor - Publisher

Ashley Murphy, Assitant Editor
Copyright 2011 (All rights reserved)

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